14-02-2018 Dax Technical Analysis

Good morning traders – it’s Valentine’s day. Let’s see whether or not the buyers fall back in love with the index and begin to assert their influence again.

14-02-2018 DAX 30 Forecast

The DAX remains bearish below 12650.

If we look at the swings (above), the facts are; we have seen a bearish impulse leg, we are currently inside a bullish reaction leg (a bounce).

Any longs should be considered counter-trend and shorts are trend-following. Shorting from current levels may be aggressive as the reaction leg may not be finished yet. I would like to see a continuation of the recent bounce and at the very least, close the gap from Monday, then extended targets could be one of the shaded zones.

DAX30 Trading Signals

Yesterday we closed out three trades (the results can be seen on the spreadsheet – about half way down this page)

DAX Short from the night before – profit taken (missed original target by 0.02 points)

14-02-2018 DAX 30 Analysis

Yesterday I talked about how difficult it would be to short considering how much support is directly underneath. We had the 12200, a multi-pivot line, the daily S2 and the 12080-12100 zone from last week. Suffice as to say that price did not dig too deeply into the support before bouncing.

On a DAX30 500 tick chart, you will clearly see a support line holding price for Monday and Tuesday and price is trying to use that support to expand higher. There was an idea to get long around 12280 to target an approximate gap close with a 16 point stop, but sellers stepped on the price around 328 bringing it back to the beginning again.

If you use a higher time frame DAX30 chart or a 2500 tick chart, try to find the bearish ignition point from the 8th Feb and mark that out as well as the double top around 650. These could be interesting target zones if any bullish momentum is able to continue.

14-02-2018 DAX 30 Key Levels

KEY LEVELS

POC *

12252

Value Area High *

12267

Value Area Low *

12225

14 Day ATR

281.52

200 EMA

12662

50 EMA

12957

Daily R2

12361

Daily R1

12307

Daily Pivot

12244

Daily S1

12190

Daily S2

12127

*These are FXCM numbers, not futures numbers. Please be aware that FXCM can often be 5-10 points higher than futures prices

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I posted up a chart about the Dax yesterday being in the oversold zone, possibly ready for bears to sell. Paradoxically, when traders are sceptical about further growth and sentiment turns bearish, that’s when we see these bullish continuation moves seem to happen. So we had a very clean break out higher, and we are currently trading around 11874.

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